Published: Written By: William D. Eggers

In the United States and elsewhere, trust in government is at an all-time low, citizen expectations are rising, and government finances are under stress. The result: the gap between citizen expectations and government’s ability to meet them has never been greater. Book after book, study after study—from both the right and the left—argue that our current industrial age model of government needs to change radically.

But how? What are the main features of a government better suited for our times? What forces will most significantly change government, and which of them have the greatest potential to make a positive difference?

Our research team examined the economic, technological, demographic and societal drivers most likely to impact the future of government. While top-down changes seem to move slowly in this realm, the seven major trends we profile in the pages that follow have the potential to reshape government – in many cases from the outside – and transform the public sector.

 

Shift #1: Government as an enabler instead of a solution provider

trillion dollar markets for social outcomes

Imagine government’s role pivoting from a provider and administrator of services to that of an enabler; its role would be to create environments in which society’s innovators can thrive.

The most successful governments focus on nurturing societal solutions from outside government, rather than on trying to solve every problem themselves. They build platforms, hold partners accountable for targeted outcomes, open up services to choice, and manage crowdsourced campaigns and competitions.  One result:: a big increase in public-private partnerships. It also encourages the growth of triple-bottom line businesses that pursue social and environmental goals along with financial ones.

This shift would alter the way our society addresses its biggest problems, moving from a government-dominated model to one in which government is just one player among many.

 

Shift #2: Made-for-me service delivery

Large group of people holding open cell phones up in air

We are 20 years into a shift towards more personalized services, and government is not immune from the forces underlying this shift. Between now and 2020, scores of public service interactions in Western governments will be personalized and available from home devices. For example, a Fish and Game stamp could have a scannable barcode that ensures authenticity, so an angler can print it at home, eliminating an in-person visit.

Many government services go mobile, moving out to neighborhoods (perhaps on “taco truck” style vehicles) and deliver in-person services to constituents. Why? Because large centralized offices don’t make sense when different groups of people have different needs, or when many traditional functions can be handled remotely through digital services.

Government services could also follow the lead of the retail energy sector, in which companies such as Simple Energy and Opower use analytics to help consumers save money and energy. Such services transform previously-hidden data into understandable and actionable insights.

 

Shift #3: Distributed governance

Economic indicators redefinedIncreasingly, “government” functions are being “co-created” with citizens, on their own or working with others. Technology makes it possible to distribute tasks to citizens. For example, Hawaii’s tsunami siren app coordinates citizen volunteers who adopt a warning siren and take responsibility to ensure it has functioning batteries.

Volunteer projects will increasingly muster platoons of citizen volunteers to do everything from identifiying potholes to updating government databases . Simple apps allow citizens to contribute to public welfare beyond simply paying taxes. Carefully designed co-creation processes will allow policy designers to work side-by-side with citizens to build better prototypes and test them more realistically, increasing the final policy’s effectiveness.

By 2020, citizens will integrate into the governing process in many ways. Crowdsourcing initiatives will allow individuals to share their experiences across many levels of the legislative process.  Wikipedia-like sites could highlight problems – and solutions – about which citizens care most deeply. Open data provide citizens access to the information that once required a staff of legislative experts to collect and analyze. Likewise, online communities will analyze data to unearth insights that government never had the resources to discover.

Governments will need to carefully design these sorts of approaches, because they all require citizen buy-in. For example, careful A/B testing can pit one approach against another, allowing citizens to vote with their actions, ignoring the approaches they see as feeble and embracing those whose execution they endorse.

One last point: Wiki-type solutions make it easy to track edits, which could highlight the fingerprints of special interests. Such solutions are the opposite of private smoke-filled rooms.

 

Shift #4: Moneyball for government

Using math to change behavior

Just as Google can estimate the severity of a flu outbreak by the number and locations of related search queries, government can potentially predict a pregnancy based on changes in purchasing patterns. Likewise, law enforcement agencies are working at predicting where a crime will occur based on previous police reports.

Predictive modeling and other types of data analysis allow the public sector to focus more on prevention, instead of just reaction and remediation. For example, rather than simply reacting to custodial parents calling to report they are not receiving child support, a predictive model can alert enforcement officers ahead of time about the non-custodial parents most likely to go into arrears.

Psychological approaches, like the UK’s Nudge Unit, can help communities move in healthy directions. For example, electric or water bills that graphically show usage stats can significantly reduce household waste. (Some power companies now show households how their usage compares to their neighbors.) Of course, nudging citizens is a delicate task, and governments will have much to learn about the right – and wrong – ways to do this.

Analytics give policymakers the ability to test potential solutions in advance. These tests won’t be perfect, but they represent a more fine-tuned approach to predict, say, whether a policy that worked in Ohio will be effective in Wyoming.

These advances will also impact how regulations are enforced in 2020. Digitization and big data analytics improve regulators’ ability to track performance and outcomes; instead of guessing, they will have actual data. This will shift administrators from focusing on processes to achieving specific targets. It also will allow regulated parties to more easily modify and adapt their approaches. They, too, will be able to more easily see actual results.

 

Shift #5: Alternative forms of government funding

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Technology opens up many unique alternatives to fund services and infrastructure, which is good news in our era of fiscal restraints. We already see increased use of payment-for-results models – such as social impact bonds and tax increment financing (TIF) – to finance costly development projects and services.

In essence, these initiatives flip the old models and move some financial risks from governments to investors and contractors; this is already a global trend.

Dynamic pricing and pay-as-you-go systems replace the blunt pricing models of the past. With greater frequency, governments will allow citizens to pay in real time for the services they use. To ensure the right balance between supply and demand for infrastructure services, governments will employ multiple forms of dynamic pricing, such as dynamic tolling and parking. In simple terms, the greater the demand, the higher the price.

 

Shift #6: Just-in-time civil service

Unbundled Education

Increasingly possible is a radical transformation in the public sector’s talent model. One option: governments apply the consulting staffing model to their workforces. Employees won’t stick to departments, but instead will move from project to project. Advanced HR policies will track skills, accomplishments, and certifications in ways that keep employees engaged.

Governments will also expand their talent networks to include “partnership talent” (employees who are parts of joint ventures), “borrowed talent” (employees of contractors), “freelance talent” (independent, individual contractors) and “open-source talent” (people who don’t work for them at all, but are part of their value chain and services). This shift from a closed model to an open, more inclusive one will redefine what “public workforce” actually means.

Meanwhile, robots, UAVs, and simple database technology will replace many of the clerical and manual labor jobs that once comprised an enormous amount of government work. Displaced workers will pivot to a new wave of jobs, many of which require close human interaction. These positions – such as organizing crowdsourced solutions, working with at-risk families or testing new ideas – will require employees to understand human motivations and also engage civic and peer networks to address social problems.

 

Shift #7: A new basis for national prosperity

Girl looking at mountains

Critics have long criticized both GDP and GNP metrics for failing to measure social success. Bobby Kennedy famously said, “Gross National Product counts air pollution and cigarette advertising… yet the Gross National Product does not allow for the health of our children, the quality of their education or the joy of their play.”

Society has evolving attitudes about what defines success, and new methods will measure social good.  They will include more holistic measures of progress and well-being such as personal safety, ecosystem sustainability, health and wellness, shelter, sanitation, inclusion and personal freedom. Taken together, they will change how governments assess their progress internally, and how they function externally.

External flag-waving will depend less on export ratios and warhead production, and more on the power of a talent pool.  A nation’s ability to attract skilled workers – and the overall mobility and flexibility of its workforce – will define its competitive positioning. This raises an obvious but vital question: how well can a nation rapidly train and retrain vast numbers of people?

 

The most agile governments openly embrace the new possibilities of technology as they grapple with economic realities. Outside forces will eventually force such changes within governments, but many will take steps today to reshape their futures. We expect increasing numbers of partnerships organized around innovative solutions that ignore old pathways and divisions between non-profit, corporate, and government. Expect to see simplified interactions with citizens, more dynamic workforces, more accurate assessments of each program’s impact, and greater citizen participation in civic work and civic policy.

Don’t expect government to hold still. The immediate future is bringing many inevitable changes.

 

To learn about the Mega Shifts in detail, click here—Mega Shifts.

William D. Eggers leads Deloitte’s public sector research and is the author of 8 books, including his newest, The Solution Revolution: How Business, Government, and Social Enterprises are Teaming up to Solve Society’s Toughest Problems (Harvard Business Press 2013). You can connect with him at @wdeggers or by email at weggers@deloitte.com